How African cities can create vibrant digital sectors
by SAVIOUS KWINIKA
JOHANNESBURG – AFRICAN cities can join other urban areas in the emerging markets and grow digital sectors to develop their local economies as well as create jobs.
The cities can use digitisation to create employment that often pay better than traditional roles, favour younger candidates, support local economies of small- and medium-size enterprises (SMEs), and are less vulnerable to future disruptions.
This is according to Boston Consulting Group (BCG) in its report, “How African Cities Can Create Digital Jobs.”
It identifies the most promising digital segments African governments can focus on to enable cities to digitise economies, create jobs and build resilient societies overall.
“Attracting targeted investment into the digital economy tends to create a virtuous cycle of economic development across sectors,” said Jan Gildemeister, Managing Director and Senior Partner at BCG, Johannesburg and co-author of the article.
“Local economies become more productive and competitive, which makes them more attractive to companies. So, in turn, they draw in even more investment to enable further gains,” Gildemeister said.
There is already positive momentum, with venture capital flows into Africa hitting a record US$5,2 billion in 2021, alongside significant investment focused on enabling greater connectivity across the continent.
BCG advises that a key goal of leaders at both municipal and provincial levels is to address high unemployment, particularly among youth, by creating future-proof jobs.
It has identified five major clusters of digital jobs that are particularly relevant for Africa.
These are a broad startup ecosystem, digital media, e-commerce, industry 4.0 and information technology outsourcing and business process outsourcing (BPO).
Nihmal Marrie, Managing Director and Partner at BCG, Johannesburg and co-author of the article, said all clusters share a common aspect.
“They require that local/regional governments be proactive in both the short term by attracting investment from the private sector and the long term by building ecosystems that can address both supply and demand constraints,” Marrie said.
Cape Town, Lagos and Nairobi, are among other local cities launching innovation hubs with an enabling environment for startups across sectors.
– CAJ News
